Experts recorded that Pakistan’s IT sector is rapidly evolving and has become a significant economic growth and innovation driver. With a young and tech-savvy population, Pakistan is emerging as a hub for software development, IT services, and digital startups. The government’s proactive support by initiatives like tax incentives, grants, and infrastructure development created a conducive environment for sector growth. The IT sector’s potential remains high despite challenges like power shortages, internet outages, regulatory hurdles, and occasional political instability.
Promising opportunities in areas like artificial intelligence (AI), FinTech, and e-commerce continue attracting interest from local and international stakeholders, paving the way for sustained growth and innovation in the coming years. According to statistics, Pakistan’s IT exports increased by 34 percent in July 2024, reaching $286 million, a notable rise compared to the 12-month average of $269 million. IT now accounts for 46 percent of the country’s total exports for the first month of FY2025, underscoring Pakistan’s growing worldwide significance as a leading provider of high-quality IT services.
According to the Government of Pakistan the 2023 Global Services Location Index by Kearney ranks Pakistan as the world’s most financially attractive IT outsourcing destination. Additionally, the International Labour Organization (ILO) has identified our country as the second most significant supplier of digital labor in software development and technology services. The third most significant digital labor supplier includes clerical and data entry services, creative and multimedia services, professional services, sales and marketing support services, software development and technology services, and writing and translation services. In addition, statistics showed that there are 45 e-Rozgaar centers located in 36 districts in Pakistan. This new measure aims to empower youth by digital skills training and employment opportunities. These centers act as hubs where individuals can receive training in various digital fields, like digital marketing, freelancing, content writing, and graphic design.
The goal is to organize 10,000 E-Rozgar centers in the country, offering affordable workspaces for freelancers and startups, ultimately benefiting 1.0 million freelancers. It is said that the government of Pakistan will also support the establishment of e-Rozgar centers through offering interest-free loans of up to Rs 10 million. In Pakistan the IT industry presently generates an annual export of almost US$ 2.6 billion. However, to attain the ambitious target of yearly exports of US$ 15 billion in the next 5 years, adding at least 200,000 proficient and specialized IT professionals is necessary. Pakistan’s ICT industry caters to the world’s largest entities among its regular clients. Several international companies, counting Global enterprises like Bentley®, Ciklum®, IBM®, Mentor Graphics®, S&P Global®, Symantec®, Teradata®, and VMware® have organized worldwide consulting services centers, research & development facilities, and Business Process Outsourcing (BPO) support services centers in the country thus generating high paying job opportunities for the talented youth, contributing to the development of the soft image of Pakistan, and attracting FDI. Major tech hubs in Pakistan’s IT & IT enabled services (ITeS) industry are Karachi, Lahore, and Islamabad/Rawalpindi. Pakistan’s ICT industry has 600,000+ Englishspeaking IT & BPO professionals with expertise in current and emerging IT products and technologies.
Startup Fund
As per the government report, the Pakistan Startup Fund (PSF) is a government-backed initiative to support and promote the growth of startups in Pakistan through encouraging investments in the country by top-notch global and local venture capital (VC) funds. VC firms often face high risks in nascent startup ecosystems. The Government recognized the necessity of intervention to address these issues and foster a robust startup culture. It has launched a program aimed at mitigating the risks faced by VCs through the Pakistan Startup Fund. The fund will offer 10 to 30 percent of the total investment made by a VC in a particular funding round as equity-free capital or a grant as the last cheque. The Government’s contribution of Rs 2 billion is poised to catalyze Rs 50 billion in the Pakistani startup ecosystem.
Software Export Board
Furthermore, the development of Pakistan’s ICT sector can be gauged from the fact that 20,000+ IT&ITeS companies are registered with the Securities and Exchange Commission of Pakistan (SECP) comprising domestic and export-oriented enterprises. ICT export remittances have surged from US$ 339 million (17.44 percent) to US$ 2.283 billion during FY2024 (July-March) as against to US$ 1.944 billion during the corresponding period previous year. In March 2024, ICT services export remittances surged to US$ 306 million, a rise of 36 percent as against to US$ 225 million in March 2023.
Compared to the previous month of February 2024, ICT services export remittances rose by US$ 49 million in March 2024. The trade surplus of US$ 1.996 billion, the highest in all Services has been realized by the IT &ITeS Industry during FY2024 (July-March), an increase of 15.84 percent as against to a trade surplus of US$ 1.723 billion during the corresponding period last year. At the same time, the services sector has registered a trade deficit of US$ 1.655 billion during FY2024 (July-March). ICT sector exports of US$ 2.283 billion are the highest among all services with ‘Other Business Services’ trailing at US$ 1.205 billion fromFY2024 (July to March).
Pakistan-based freelancers contributed foreign exchange earnings to Pakistan’s economy through remittances of US$ 350.15 million during FY2024 (July-March). Pakistan’s ICT industry exports to 170 countries and territories. Source recorded that the top 15 export destinations for Pakistan’s ICT industry are the UK, UAE, Ireland, Singapore, USA, Canada, China, Saudi Arabia, Germany, Norway, Sweden, Australia, Switzerland, Japan, and Malaysia.